As a Chicagoan, I’m often lead to believe that the Upper-Midwest is the only place of sanity in this country. So I’m proud to see Wisconsin be the place where people draw the line and call BS on the attack on public workers, state budgets, and austerity amidst a financial, foreclosure and economic crisis where the government’s response has had the protection of banks, bondholders, creditors, Wall Street and the top 1% at all costs as the driving tenant, a class war driven by the rich. Here are some other things I’m reading on the protests.

Doug Henwood was local when the protests started, and has pictures, thoughts and followup. Joel Rogers explains the politics of Wisconsin to Henwood: “To outsiders, it’s mysterious that the same state could have spawned Joe McCarthy and Robert LaFolette, or Scott Walker and Russ Feingold. Rogers explained that politics in Wisconsin has historically been driven by an alliance of industrial workers and capital-intensive dairy farmers on the left, opposed on the right by a mainly Catholic rural population. They’re pretty evenly divided, thus the contrasting figures and tight elections.”

In its Jan. 31 memo to legislators on the condition of the state’s budget, the Fiscal Bureau determined that the state will end the year with a balance of $121.4 million.

To the extent that there is an imbalance — Walker claims there is a $137 million deficit — it is not because of a drop in revenues or increases in the cost of state employee contracts, benefits or pensions. It is because Walker and his allies pushed through $140 million in new spending for special-interest groups in January.

Cutting taxes for friends to provoke a short-term crisis to taking a bite out of working people providing services for the people. There is a class war, being waged by the rich on the rest of us.

Not About the Budget

The most important thing to understand about the proposed changes in Wisconsin is that a lot of the proposed changes about unions have nothing to do with the state budget. One rule is that unions are not being able to collect dues. This has nothing to do with the state budget. A lot of it has to do with the union’s ability to bargain or secure future wages. That has nothing directly to do with the budget. The Republicans have enough votes to mandate benefit cuts for the unions if it was a budget thing. But it isn’t. It’s simply using the state to quash a union that opposed a Governor’s election by bleeding it out. As Ezra Klein noted:

The proposal doesn’t stop there, though. “Contracts would be limited to one year and wages would be frozen until the new contract is settled. Collective bargaining units are required to take annual votes to maintain certification as a union. Employers would be prohibited from collecting union dues and members of collective bargaining units would not be required to pay dues.” These rules have nothing to do with pension costs or even bargaining. They’re just about weakening unions: They make it harder for unions to collect dues from members, to negotiate stable contracts or to survive a bad year.

The best way to understand Walker’s proposal is as a multi-part attack on the state’s labor unions. In part one, their ability to bargain benefits for their members is reduced. In part two, their ability to collect dues, and thus spend money organizing members or lobbying the legislature, is undercut. And in part three, workers have to vote the union back into existence every single year. Put it all together and it looks like this: Wisconsin’s unions can’t deliver value to their members, they’re deprived of the resources to change the rules so they can start delivering value to their members again, and because of that, their members eventually give in to employer pressure and shut the union down in one of the annual certification elections.

You may think Walker’s proposal is a good idea or a bad idea. But that’s what it does. And it’s telling that he’s exempting the unions that supported him and is trying to obscure his plan’s specifics behind misleading language about what unions can still bargain for and misleading rhetoric about the state’s budget.

Talk about the Shock Doctrine.

Again Not Overpaid

Econbrowser’s Menzie Chinn graphed up Keefe’s paper on Wisconsin for EPI. We’ve gone through this before, but controlling for education and benefits state government workers make less than private sector workers. Red is public sector workers:

An Attack On Women

As Dana Goldstein writes, the unions exempted from these attacks are those more likely to have supported Walker, and they are also those more likely to be male:

About 80 percent of American teachers, for example, are female; at the elementary school level, nearly 90 percent are women. Nursing is 95 percent female. Nationwide, the majority of public sector union members, represented by AFSCME and other groups, are women.

Meanwhile, over 70 percent of law enforcement workers in the United States are men. Our firefighting ranks are 96 percent male and over half of all professional firefighting departments have never hired a woman.

16 Responses to Wisconsin Draws the Line on Austerity Opportunism and Class War.

I’m a transplant from Australia to Chicago so my assumptions about job security are a bit different from native-born Americans (what do you mean, they can just fire you for any reason…), but this seems extreme even by US standards for a legislature to unilaterally give large pay cuts and put everyone on one year contracts. It seems strange that it is happening in Wisconsin too where public education is pretty effective and there wasn’t even a serious budget deficit. Presumably you would want to retain and keep happy your teachers who are doing a better job than elsewhere.

Looking at the posts on Ezra Klein’s blogs I’m amazed at the level of bitterness directed at public sector workers. People do seem to viscerally believe that either it is a zero-sum game between middle-income private and public workers. Either that or it is simple as misery seeking company – my retirement plan sucks so yours should too.

Quality costs money! Besides it is better to invest in children and healthcare than coddle irresponsible bankers and greedy corporations. They are hoarding cash while ordinary working people are going without.

The problem is there are other areas to cut but Walker hates unions, so he’s tageting them. AFSCME agreed to the monitary cuts but want to keep collective barganing. Walker said not budging. This is blatent union busting. This bill would also set a legal precident that would affect all unions, not just in Wisconsin but across the country. Just like when Regan fired the traffic controlers, it stripped the right to strike from most unions under the osspices of not affecting public services. also there was no budget shortfall untill Walker took office and passed a tax cut for corporations. I live in Milwaukee county, and he claimed to have balanced our budget but the candidates running for his old job say that were still broke and need to cut more.

Just a question, but does your graph also account for benefits such as medical insurance and retirement contributions? If not, then representing the comparison of salary against salary seems misleading, since private sector jobs would likely be responsible for paying for at best a large portion (if not the entirety) their own insurance and retirement contributions. This could explain the perceived gap in compensation you referenced (and may even reverse it).

I just wanted to follow up and say that part of what is so galling is the cynicism of how it has all been carried out. He is dressing it up in terms of fairness and shared sacrifice but it all just seems to be done in such bad faith. Its not that I don’t think pensions and health care costs are a serious issue, it is just such a cynical way to go about addressing the issue.

I’m amazed at the tolerance some people show for pretending that the increase in pension contributions and healthcare contributions is somehow not equivalent to a 7 or 8% decrease in pay. Imagine if a 7 or 8% hike in state income tax was instituted targeting a specific group of votes – the effect on their paychecks and the state’s budget balance would be roughly the same. I understand the desire to make pension and health care costs more transparent but this is something else… At least be honest about what you are asking teachers to do. The simultaneous attempt to gut the bargaining process gives a pretty clear signal to the teachers that they are working against someone who is playing hardball.

It doesn’t really seem like a well-meaning plan to get everyone to share the burden – it is the combination of aggressive cuts to one group and attempt to spin it as “just being fair” to his core constituency that just seems so divisive and cynical.

By far the most effective effort I know of personally to restrain union wage demands was the 1983 wage accord in Australia – an agreement between the current government and unions to restrict wage demands to inflation, put more pay towards defined-contribution pensions. The only reason that it got off the ground was because the current prime minister was a former union head, and negotiating in good faith was able to make a strong case that the changes were in the best interests of the country. I understand public employee unions are extraordinarily difficult to work with, but they’re much worse if they know they’re negotiating with someone who is clearly calculating how much he can extract from them and get away with it.

I oppose Governor Walker’s bill mainly because he did not give time to discuss, understand, adjust it in discussion with the people he supposedly represents: the whole of Wisconsin! I wanted to highlight one thing about the 2010-2010 budget projections. One has to read the document by Bob Lang of the Legislative Fiscal Bureau (http://goo.gl/uujr1) carefully because there are two “payments due” that could be counted against the 2010-2011 depending on how the legislature handles it: Minnesota/Wisconsin Income Tax Reciprocity Payment which is about $60M and a refund to the Patients Compensation Fund which could be about $200M. If these are paid in the current tax year, then they would produce a gross deficit of $137M. It’s useful to have this full fact in your back pocket for discussions. This fact, notwithstanding, the same note indicates that tax and HSA legislation introduced since Walker become governor will cost $117M between now and the end of the 2011-2013 biennium. Please support the demonstrations in Madison and senators from Wisconsin as they try to get reasonable discussions on budgetary issues in their state.

You do realize that most people in the country have no clue what is happening in Wisconsin.

There is much more coverage of the various arab countries where people are lauded for standing up and being counted while in the home of democracy, that isnt tolerated.

Its pathetic that we give so much credence and respect for people in other countries and their right to protest while in this country protest is codified with protests pens miles away from where protesters want to be.
In other countries we support people stand even if it includes violence while here we find every reason possible to forbid protest.

One of the best ways to not allow repetition of this is to just not talk about it.
Wisconsin is much further than the middle east it seems.

Good luck to the people fighting for their rights.
If its not you, then no one will do it. Certainly not the politicians..